Thoughts on "The Free Trade Lie Is Exposed"
I missed the furious debate in the comments of last week's essay by gjohnsit, The Free Trade Lie Is Exposed. Ironically, I missed joining in because of an effect of free trade: the crappification of everything. My laptop appeared to have finally blown its power supply. For the past year the battery would drain if left in the PC while traveling, and often would not charge once I settled in and plugged it in. Last week, it simply would not turn on, period. So, I was forced to spend money that, for me, is precariously scarce right now, taking it to a local tech whiz I trusted would either fix it for less than $200 or honestly tell me it needed to be replaced.
Turns out the problem was two little metal clips which hold the small screws attaching the hinges between the screen and the body. The little metal clips has simply failed: free trade is focused on getting the cheapest possible consumer goods, and the metal has fatigued and broken from the stress of opening and closing the screen -- what? maybe 300 to 400 times. The metal bracket on which the hinges rest and thus come lose, and knocked against the little assembly where the electric cord is plugged into the PC. This knocking had jarred loose the electrical connection between this little assembly and the motherboard, and pushed back the pins in the connector. This is something we never hear in the debate about free trade -- the cheap plastic shit made in sweat shops overseas, and how much more often it has to be replaced or repaired than goods made before the era of free trade.
So, I'm in a foul mood to begin with, and it only gets worse as I peruse the adversarial comments to gjohnsit's post. I simply do not know how anyone can regularly visit a site like this, and (I assume) consider themselves progressive, or leftist, or whatever, and argue against gjohnsit to defend free trade. I saw the same phenomenon on DailyKos, but at least there I could categorize defenders of free trade, such as Armando, as arrogant professional class types, lacking any real empathy for working people, who simply did not have the intellectual capacity to move beyond the economic doctrines they had been spoon-fed in college.
We on the left are fond of ridiculing the wrong-wing withe the saying that you can have your own opinion, but you are not entitled to your own facts. And here are the facts on free trade. I have blogged about thus before, and if you want links, search and find what I have written before.
Since the radical free trade / free market era began under Thatcher and Reagan in the 1980s, economic growth rates in the industrialized countries have been slower than they were before.
Since free trade, economic growth rates in developing countries has also been slower than before.
Since free trade, the United States has ceased being a democratic republic, and has become an oligarchic plutocracy. Now, you can argue that free trade was not the sole causal factor, because obviously there ere other causal factors in the rise of our new kleptocratic ruling class.
But here's one fact that is directly caused by free trade. Since free trade, Mexico has become a narco-state that is on the verge of being a failed state.
How do I know that is a result of free trade? History. After Britain forced the Chinese government to accept free trade in the 1830s, what happened to China?
I am frankly disgusted by people who argue in favor of free trade at this point. They are obviously ignoramuses who have refused to study and learn the lessons of history.
Comments
Tell us how
you really feel! Don't hold back, my friend, let it out!
Seriously,i tend to agree with you simply due to empirical Fucking evidence!
I'm kind of a believer in my own lying eyes that way.
Stop These Fucking Wars
peace
Ya got to be a Spirit, cain't be no Ghost. . .
Explain Bldg #7. . . still waiting. . .
If you’ve ever wondered whether you would have complied in 1930’s Germany,
Now you know. . .
sign at protest march
free traitors
The closest I ever got to the Bojo over at Daily Kos was when I used the term "free traitors" to describe free trade advocates.
The Constitution gives the Federal Government power to tax and regulate international trade for a reason! And you've done a fine job of describing that reason, by the way!
"US govt/military = bad. Russian govt/military = bad. Any politician wanting power = bad. Anyone wielding power = bad." --Shahryar
"All power corrupts absolutely!" -- thanatokephaloides
Free Traitors - Nice Touch
I like it. It's been a while so I had to look up the OP. I remember reading it, but felt no need to chime in because gjohnsit did a better job of defending his arguments than I could have. Here's the post:
https://caucus99percent.com/content/free-trade-lie-exposed
"They'll say we're disturbing the peace, but there is no peace. What really bothers them is that we are disturbing the war." Howard Zinn
laptop hinges
One small point of order: on any laptop, the hinges are the proverbial Achilles' heel and always have been. Problems at the hinges have cost me more than one!
"US govt/military = bad. Russian govt/military = bad. Any politician wanting power = bad. Anyone wielding power = bad." --Shahryar
"All power corrupts absolutely!" -- thanatokephaloides
I'm no expert on free trade TW
but when a nation has trade deficits in the billions of dollars as is the case here in the USA, common sense should be enough to let people know that there is nothing free about it.
Good essay, Tony
How about writing an essay over the soon-to-be tariff hikes on steel and aluminum, and their effects on the domestic economy. A video appearing on Al Jazeera English gave a reasoned examination of the implications but was not a very deep analysis. One point stuck out: aluminum and steel workers make up about 600,000 of population whereas domestic workers in industries dependent upon aluminum and steel number 3.5 M.
[video: https://www.youtube.com/watch?v=h9VkL0NUksY]
@Alligator Ed
Sorry to disappoint, but I will probably decline your request for an essay. I will, however, address the question here. The likely impact of Trump's tariffs on steel and aluminum is going to be some rather steep increases in prices for those materials. However, this will not ignite inflation through the rest of the USA economy, because demand for those materials is severely depressed by the low levels of investment in infrastructure and industrial capital goods.
This brings us to the major point about tariffs: they are pretty much useless and ineffective if they are not combined with a national industrial policy. At the end of January, I discussed this in Protectionism in the age of solar cells. In the 1800s, it was generally understood that the American School of political economy, as it was called, was in opposition to British "free trade" economics of Smith, Ricardo, Mill, etc., and was comprised of three major economic policies: 1) protection of the power of American workers to earn (by not forcing them to compete with the cheap labor of the colonial subjects of the British empire); 2) a national banking system that favored investment in actual industry and agriculture, and discouraged financial speculation, and purchases of imported luxury goods; and 3) internal improvements (what we call today "infrastructure"). I write much more about this at the posting linked above.
These three key American School economic policies were implemented by other countries that successfully industrialized in the late 1800s, most notably Germany, Japan, and Russia. In the 20th century, American School economic policies were implemented by Japan again to recover from the devastation of World War 2, and later by South Korea, Taiwan, Malaysia and other countries. (See James Fallows’ December 1993 article in The Atlantic, “How the World Works.”)
Today's world trade system is designed to obtain cheap consumer goods by ignoring environmental and safety concerns, and ignoring the need to fund worker retirements. It is a system that benefits multinational corporations far more than anyone else. It must be replaced with a new world trade system which is designed to facilitate the $100 trillion in new investments in zero-carbon industries, electricity generation, and transportation, and which benefits all participating countries and their people equally.
- Tony Wikrent
Nation Builder Books(nbbooks)
Mebane, NC 27302
2nbbooks@gmail.com
Oustanding comment
And this:
The current system has been designed by neoliberal globalists and promoted by bought off politicians such as the Clintons and Barack Obama whose interests lie not in the economic health of the people who actually produce the goods and services of any country, but in the corporatization of the world. Pride in the quality of work and product has been long sacrificed in favor of meeting production quotas.
Most of the inhabitants of the world are "throw aways" to the globalists. We are cogs in the neoliberal economic wheel to be used and discarded when we cease to be of use to their system.
Excellent essay, Tony.
Do I hear the sound of guillotines being constructed?
“Those who make peaceful revolution impossible will make violent revolution inevitable." ~ President John F. Kennedy
I missed that debate too.
Remember tho that this place is mostly for refugees from Daily Kos, and that refugees are not always better than the places whence they left. The Mayflower Pilgrims, for instance, those icons of Thanksgiving, were refugees from countries they were too intolerant to live in who went to Massachusetts to live off of the native peoples of that region of the world (before killing them off).
“When there's no fight over programme, the election becomes a casting exercise. Trump's win is the unstoppable consequence of this situation.” - Jean-Luc Melanchon
It's not really nation-states that we're dealing with.
It's not really nation-states that we're dealing with, it's multinational corporations.
Essentially what has happened is a multinational corporate coup, through the purchase of political influence in what were once sovereign nations (or at least the trade/macroeconomic policies of what were once sovereign nations), allowing multinational corporate interests to make the lion's share of the profits from deregulated globalization, as the 'savings' are not being fully passed down to the consumer (contrary to 'popular' belief).
Multinational corporate interests are now being served at the expense and wellbeing of all nations through which they operate.
The threat from 'protectionists' is that they want to put the trade policies of the biggest customer (US) ahead of multinational corporate interests, which would upset their entire one-world government apple cart, eventually causing export-based countries to start looking for ways to strengthen their own consumer-base(s) and domestic economies to offset the reduced business coming in from their biggest customer (US), or begin reducing production, which they really can't afford if they want to sustain their domestic economies.
A balanced US trade policy (i.e. a reversal of the multinational corporate coup) would result in increased living standards worldwide (at the expense of multinational corporations that have been making the lion's share of the profits from deregulated globalization).
And anyone who thinks the 'savings' are being fairly passed down to the consumer, I've got a bridge to sell you.
Mike Taylor
I missed the debate.
Free trade is as real as free markets. Everything is rigged in favor of the house. I support Trump's tariffs. Funny how everything that helps workers and the middle class is tantamount to doom for the globe.
"Religion is what keeps the poor from murdering the rich."--Napoleon
Well OK then.
So I'm a traitor/ignoramus/arrogant/Armando for thinking that protectionism is (and always has been) the shortsighted policy of greedy industrialists that hurts consumers and is a major cause of every big war in the last two hundred years?
Good to know.
There's nothing wrong with free trade. What's wrong is that we allow the benefits of that trade to flow to only a select few at the expense of the rest of us.
But hey, why spoil a cute little epithet like 'free traitor' with such an obvious explanation.
There's a good discussion about all this at Pat Lange's place. I found this comment especially trenchant:
Bottom line: whether its Russia with politics or China with trade, we need to stop blaming the rest of the world for our own homegrown problems.
And we CERTAINLY need to stop calling people names who have legitimate reasons for not agreeing with knee jerk Presidents and their simplistic, buck-passing, dangerous, and ultimately futile policies.
The current working assumption appears to be that our Shroedinger's Cat system is still alive. But what if we all suspect it's not, and the real problem is we just can't bring ourselves to open the box?
@Not Henry Kissinger
In answer to your first question: Yes. Especially since you are explicit in your belief that "protectionism is ... a major cause of every big war in the last two hundred years." Yours is an assertion that has been repeatedly debunked.
It's no surprise, then, that you completely ignore the issue of free trade, not protectionism, causing the Opium Wars, and the failed narco-states of Mexico in the late 20th century, replicating the historical example of China in the early 19th century. This is what I consider the most weighty value judgement against free trade. Or perhaps you agree with mainstream economists that there is no room for normative judgments in economics? Or are you just a typical westerner, with little concern or interest in what experts from other countries have to say:
Adam Smith: ‘Intellectual Prostitute’ For British East India & Slave Traders
Smith-Ricardian ‘Free Trade’ Justified Slave Trade
Amitav Ghosh on "Opium and Empire"
When these historical embarrassments are pointed out to the "free marketeers" of today, they really freak out, like in this article from the Cato Institute.
But the plain fact is that Adam Smith was paid by slave traders to come up with a justification for their immoral exploitation and murder (how many captives died in transit?) of other human beings. Back in Adam Smith's time, his "free market" doctrine was called laissez faire and it was emphatically rejected by the first Secretary of the Treasury, Alexander Hamilton. (Unfortunately, though the slave trade was ended in the U.S. by the early 1800s, the institution of slavery itself continued and festered until it helped cause the rupture of the 1860s.) It was not until the 1960s and 1970s, when laissez faire was repackaged as "free markets" and "free trade" by Milton Friedman and sold to Americans as "freedom to choose" that the economic doctrines of the slave trade and opium wars began to destroy American from within.
Henry C. Carey was the best known USA economist of the mid-1800s, and was Lincoln's economic adviser. So if you don't like those unwashed colonials from India and the Phillipines demolishing the theory of free trade, here's fellow American Carey:
Commerce, Christianity, and Civilization Vs. British Free Trade: Henry Carey's replies to the London Times, February 1876
Commerce, Christianity and Civilization Vs. British Free Trade: Henry Carey on the British Forcing Opium on China
Applying the word "traitor" to advocates to free trade is entirely accurate. In USA, the history of political economy is almost hopelessly muddled by the fact that Hamilton's policies were continually contested by the free trade faction--which was largely centered in the slave-holding aristocracy of the South. Hamilton devised a national economy in which continual improvements in the technological modes of production--replacing animal and human muscle power with ever more powerful machinery--were the most important causal factors of creating national wealth. In opposition to Hamilton's political economy was the feudal economics of the British oligarchs and the Southern slaveholders, in which the major determinants of creating wealth were holdings of already existing wealth, most especially land, slaves, and species.
From The conspiracy of free trade: Anglo-American relations and the ideological origins of American globalization, 1846-1896, PhD dissertation at the University of Texas, Austin, 2011:
America’s economic nationalists in turn considered these Cobdenite [free trade] efforts as part of a vast, British-inspired, free trade conspiracy. This period’s leading protectionist intellectuals alternatively held an Anglophobic belief in infant industrial protectionism and government-subsidized internal improvements.
Henry Carey wrote in 1851:
In April 2011, Ian Fletcher posted on Huffington Post a summary of his book, Free Trade Doesn't Work: What Should Replace It and Why, detailing the faulty assumptions behind the Theory of Comparative Advantage, the theoretical basis of free trade:
Dubious Assumption #1: Trade is sustainable.
Dubious Assumption #2: There are no externalities.
Dubious Assumption #3: Productive resources move easily between industries.
Dubious Assumption #4: Trade does not raise income inequality.
Dubious Assumption #5: Capital is not internationally mobile.
Dubious Assumption #6: Short-term efficiency causes long-term growth.
Dubious Assumption #7: Trade does not induce adverse productivity growth abroad.
Economists who have attempted to honestly evaluate the effects of free trade agreements such as NAFTA have usually felt compelled to admit that the effects are not as beneficial as they first believed. Robert Scott of the Environmental Policy Institute concludes that the 17-year-old North American Free Trade Agreement, which was supposed to produce trade surpluses and hundreds of thousands of jobs in the United States, actually created "trade deficits with Mexico totaling $97.2 billion [and] displaced 682,900 U.S. jobs."
The historical, statistical fact is that many countries had higher
rates of GDP growth and income growth, and significantly less income
inequality BEFORE the current world regime of trade agreements came into
effect. A study by the Center for Economic and Policy Research in February 2014 noted:
After NAFTA, there was also a
decline in U.S. exports to Mexico of crucial capital goods such as rail
locomotives, machine tools, farm tractors, construction equipment and
electricity generating equipment. Proponents of free trade have argued that these types of declines were caused not by NAFTA, but by the peso crisis which occurred soon after NAFTA took effect. But if NAFTA resulted in economic growth, you would expect these declines to eventually be reversed, with the statistics showing improvement ten or fifteen years later.
They do not.
According to Rolling Stock: Locomotives and Rail Cars, Industry Trade and Summary, Publication ITS-08, by the United States International Trade Commission, March 2011, from 2000 to 2009, the locomotive fleet in Mexico has shrunk 19.8 percent, from 1,446 to 1,160. (Table C.124, page 108)
In Canada, the number of freight locomotives fell from 2,979 to 2,671, a fall OF 10.3 percent (Table C.9, page 103). Mexico's active rail car fleet fell by 19.8 percent, from 34,764 in 2000, to 27,873 in 2009. (Table C.16, p110).
What happened in Canada is even worse: a 26.5 percent collapse in
rail freight cars from 105,096 in 1999 to 77, 278 in 2008. (Table C10,
page 104).
This does not appear to me to be a national economy improving. These are
national economies in collapse - exactly what the proponents of
protectionism argued would happen through most of the 1800s, and what
opponents of NAFTA argued would happen. NAFTA is is not helping the
Mexican and Canadian economies improve
Manuel Perez-Rocha, an associate fellow at the Institute for Policy
Studies in Washington, D.C., and a Mexican national, said in a review of NAFTA in January 2014,
In September 2013, three economists, Michael Elsby, Bary Hobijn and Ayşegül Şahin, released the results of their analysis at the Brookings Institution:
In April 2015, the Royal Economic Society summarized the work of two economists, Hufbauer and Schott, who had written a 1992 study on the expected effects of NAFTA. One source Hufbauer and Schott relied on was a seven-volume report for the World Bank. But what the RES was interested in, was that Hufbauer and Schott had reevaluated the effects of NAFTA in 2005.
In late 2013, economists David H. Autor, David Dorn and Gordon H. Hanson published a study in The American Economic Review, The China Syndrome: Local Labor Market Effects of Import Competition in the U.S. They concluded that from 1990 to 2007, the share of all manufacturing
imports coming from low-income countries increased from 9 percent
to about 28 percent, and that this increase in cheap imports accounts for about one-quarter of the aggregate decline in
United States manufacturing.
If free trade is so disastrous in its actual effects, the question that must be asked is: Why do political and economic elites continue to cling to free trade? In Free Trade Is Elites Betraying Their Own Populations, Ian Welsh explains.
You repeatedly argue that the fault lies with American management, not with free trade, for moving production overseas. In this you are using a smaller truth to deny a larger truth. The entire point of protection is to prevent the national economy from being opened to imports that can be produced cheaper in countries that do not protect the environment and workers and which do not invest in a social safety net comparable to ours.
You also point to automation as a cause. That is the standard professional class excuse. When most US factories were relocated overseas, they were NOT replaced by new factories equipped with the latest and best new production equipment. In most cases, what literally happened was that the US factory was disassembled, the production equipment crated and packed into containers for shipment, then shipped overseas, and the whole production line reassembled. There was no new, fully automated equipment. There was no new robots replacing workers. If there were, why are Chinese workers three times more likely to be killed on the job? These gruesome facts point to something that almost everyone overlooks, or do not want to admit: the US production sent overseas was NOT replaced by newer, more efficient technologies and production equipment. Why would someone not want to admit US production sent overseas was NOT replaced by newer, more efficient technologies and production equipment? Because insisting that “automation and robots are replacing all those jobs” allows them to avoid facing the truly murderous implications of what they want to believe about how the world works. It allows them to cling to their belief in the neoliberal lie that “free market” capitalism delivers the greatest benefits to the greatest number of people. It allows them to avoid having to face the harsh reality that what they believe is literally killing people.
Since you whine about being called names, to close, I will quote Thomas Paine, from The Crisis: "words were made for use, and the fault lies in deserving them."
- Tony Wikrent
Nation Builder Books(nbbooks)
Mebane, NC 27302
2nbbooks@gmail.com
Next time:
I'll just hit a few lowpoints:
And yet...not even a single debunking link.
Tell you what, Tony. You name one major war in the past two hundred years that wasn't presaged by a trade war, and Ill retract my whole comment.
You are confusing free trade with mercantilism. The British Opium Wars were predicated on expanding a British monopoly over maritime trade with the Far East. It's not free trade if only one country is allowed to do it.
And while we're on China, you conveniently ignore the importance of US 'Open Door' policy of the late nineteenth century in curbing those abuses.
So you see, US free trade policy actually ended the Opium War-type economic exploitation of China by mercantilist European powers. It didn't cause it.
Also too, Mexico is exactly the situation the author of the comment I quoted is referring to when he talks about the US being the apex economy of the region, and so able to economically exploit Latin American countries through mercantilist agreements like NAFTA.
And that's the point: NAFTA isn't actually Free Trade at all. It's actually just a way for Big Money interests to buy their way into poorer countries in order to take over markets and arbitrage cheaper labor. Pretty soon all that fast money sloshing around drives an already corrupt government over the edge, and you have the beginnings of a failed state.
But tariffs aren't going to fix the Mexico problem, Tony, because the problem is not in Mexico. The problem is in the US - in the boardrooms of multinationals where people get paid vast amounts of money to think up ways to fuck poor people over on both sides of the border.
And THAT's the point you are truly ignoring.
Oh, couple of other things:
As a courtesy, I'd appreciate a head start if/when your goon squad decides to come for me.
Ad hominem attacks are not welcome at C99, Tony. Just so you know.
And thank you for quoting Thomas Paine. He was indeed a fine man, and like every one of his Revolutionary contemporaries, believed strongly in Free Trade.
The current working assumption appears to be that our Shroedinger's Cat system is still alive. But what if we all suspect it's not, and the real problem is we just can't bring ourselves to open the box?
Which standard are you
Which standard are you applying? "protectionism is ... a major cause of every big war in the last two hundred years."? Or "presaged by a trade war"? The latter would be meaningless.
American Revolution
War of 1812
Greek War of Independence
Mexican–American War
Crimean War
US Civil War
Wars of Italian Unification
Franco-Prussian War
Bolshevik Revolution and Russian Civil War
World War 1
World War 2
Algerian War of Independence
Angolan War of Independence and Civil War
1948 Arab–Israeli War
Six Day War
Yom Kippur War
Nigerian Civil War
Eritrean War of Independence
Bosnian War
Western Sahara War
Sudanese Civil Wars
Somali Civil War
Rwandan Civil War
- Tony Wikrent
Nation Builder Books(nbbooks)
Mebane, NC 27302
2nbbooks@gmail.com
It's very simple...
International trade conflicts lead to international militarily conflicts and always have. Presage means come before - an omen.
Most of the various civil wars you cite are either colonial wars of independence from US & European mercantile exploitation (see eg. Algeria, Eritrea, Rwanda, etc.) or Cold War proxy fights (Middle East, Greece, etc.)
You also forgot the Spanish American War (fought over mercantile trade in the Caribbean and Philippines), Libya Civil War (to stop Qadaffi's pan African trading bloc), as well as Ukraine and Syria (oil and gas trade).
So despite your long list (and a bunch of others you neglect to mention) you have yet to cite one major war of the last two hundred years where a trade conflict was not a primary cause of a military conflict.
Debunked.
Any questions? I'll wait.
The current working assumption appears to be that our Shroedinger's Cat system is still alive. But what if we all suspect it's not, and the real problem is we just can't bring ourselves to open the box?